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The Irish
Independent reports that crisis-ridden Health Minister James Reilly now needs a
€300m bailout from the taxpayer to plug the black hole in the health budget.

Dr Reilly's competence is now under scrutiny on several fronts in the wake of
the botched handling of his inquiry into the death of Savita Halappanavar – with
President Michael D Higgins entering the fray on the issue last night.

Mr Higgins (pictured above) called for "some form of investigation" which meets
the needs of the public concern, the family and the State.

Despite the refusal of Praveen Halappanavar to cooperate with the inquiry into
his wife's death, the Government is insisting it will press ahead with its
investigation and will not be setting up a public tribunal.

The inquiry will have to produce an interim report before Christmas.

And the three new members of the inquiry team, to replace three consultants from
Galway University Hospital, are to be announced.

Separately, Dr Reilly's failure to keep control of spending has resulted in the
Department of Health needing an embarrassing emergency budget.

The failure to manage the budget means savings will have to be made in other
departments to cover the shortfall.

Ministers are warning that the Government wants to budget more accurately in the
health sector.

The need for an extra budget is acutely embarrassing for the Government in its
dealings with the IMF-EU bailout team.

Health spending is currently running at €336m over budget. Although the
Government won't say how much extra funds are required, the Irish Independent
understands a figure of €250-€300m is projected.

After months of government denials the health budget won't come in on target,
Public Expenditure Minister Brendan Howlin has confirmed that a Supplementary
Estimate will have to be passed through the Dail.

Mr Howlin met with Dr Reilly again yesterday evening to discuss the health
budget – the second such meeting in a week.

The supplementary budget will be separate to any new measures announced in
December in Budget 2013.

The HSE is heading towards a deficit of €400m by the end of the year, but there
are no details yet as to how big the bailout will be. But Mr Howlin said it will
be "a tiny, tiny, tiny fraction" of the annual €13.5bn budget for health.

"I can confirm it is likely there will be a supplementary budget for health," he
said.

In an ominous warning to Dr Reilly, the minister also said the Government wanted
to budget more accurately for health.

Fianna Fail's Sean Fleming said there wasn't overspending, but "under-budgeting"
and said Dr Reilly's annual estimates were flawed.

'Bizarre'

Sinn Fein's Mary Lou McDonald said it was "bizarre" an emergency budget would be
brought in just days before the full Budget for 2013.

The estimate compares with the €148m bailout in 2011 when he was able to blame
the way the health budget was framed by the last government before he took over
as minister in March.

Despite imposing cutbacks in home help and other services, the Health Service
Executive (HSE) is on course for a deficit of €400m this year, driven by a rise
in hospital patients, a surge in medical cards and the cost of drugs.

HSE chief executive Tony O'Brien said the number of patients admitted through
hospital emergency departments went up by an additional 7,091 in the first nine
months of this year compared with the same period in 2011.

An additional 10,260 patients had inpatient treatments and there has been a rise
in the numbers of patients calling their GPs in the evenings and weekends.

Among the biggest pressures is the inflation in the number of people covered by
medical cards – rising to 1.8 million by September after an increase of 144,540
since the end of last year.

"The HSE continues to face significant financial challenges to year end in areas
such as childcare, acute hospitals and community drug schemes based upon the
demand for services," Mr O'Brien said this week.

It now looks like the HSE will end up over €250m in the red despite the cuts and
upfront payments of €125m from private health insurance companies for treatments
in public hospitals.

Meanwhile, President Higgins said any inquiry into the death of Ms Halappanavar
should result in women in Ireland getting the medical services they need.

Speaking in Liverpool yesterday, the President extended his sympathies to the
husband and family of the Indian woman. He said there should be "some form of
investigation which meets the needs of the public concern, the need of the
family and of the State".

The Irish Independent also
reports that debt-ravaged householders -- many of whom borrowed every penny of
the value of their homes at the peak of the boom -- have been given fresh hope
of a deal after it emerged that new lenders are taking over their loans.

Bank of Scotland (Ireland) is attempting to sell
its mortgage book here, in a move that will mean its 80,000 mortgage holders are
more likely to get a write-off deal on their debts.

Companies that buy up mortgage and consumer loan
books are more likely to agree to write off debts as they have bought the loan
portfolios at a massive discount. Many of these took out 100pc mortgages.

And now it has emerged that State-owned Permanent
TSB has signed a €287m deal to sell its car loans, consumer loans and some
business loans. The buyer is understood to be Deutsche Bank.

Earlier this year, Australian group Pepper bought
the mortgage book of GE Money and has already started writing off mortgage
holders' debts.

Bank of Scotland/Halifax closed its operations
here two years ago and now manages the 80,000 residential and buy-to-let
mortgages from Britain.

Most of the mortgages are trackers, with many of
the buy-to-let mortgages on deals that mean only the interest is being repaid.

Huge numbers of the mortgages it issued were for
100pc of the value of homes at the peak of the boom.

Those who took out 100pc mortgages are now
heavily in negative equity after house prices collapsed by half.

Earlier this week, the bank sold its Irish
commercial loan book at a massive discount – one-tenth of its original value.

And it emerged this week that the bank has
written to residential mortgage holders telling them they were no longer
protected under Central Bank rules here, particularly those that apply to those
behind on their repayments.

It claimed yesterday this was an error and
mortgage holders here still had protections under regulatory rules, even if they
were in arrears.

Now the bank's parent, Lloyds, is understood to
be trying to offload its Irish mortgage loan book. It has €8bn in mortgages,
with around 22pc of the value of the mortgages in some form of arrears.

The bank closed its 44-branch banking operation
in 2010 and handed back its banking licence. It still controls the mortgages but
has outsourced the management of them to debt recovery and loans servicing
company Certus.

Bank of Scotland has already sold its car-leasing
operation to Bluestone Asset Management, a company that brokers said was more
inclined to strike deals with heavily indebted consumers.

And yesterday it emerged that state-owned
Permanent TSB has signed a €287m deal to sell its car loans, consumer loans and
some business loans. The buyer is understood to be Deutsche Bank.

The bank has also agreed to hand over the
business units that look after, or service, the loans to a new company set up by
managers of the bank's former personal finance unit.

They have been given the new contract to manage
the book on behalf of its new German owners.

The car loans and consumer loans are being sold
to a newly created company called Consumer Auto Receivables Finance. It is
understood to be controlled by global banking giant Deutsche Bank.

Finance experts said the sale of loan books to
new operations offered the best hope for consumers to get deals on their debts,
especially for those in trouble meeting repayments.

Discount

Karl Deeter of Irish Mortgage Brokers said Bank
of Scotland was planning to sell its mortgage loan book.

Operators that buy distressed loan books at a
heavy discount can then make a profit by off-loading the loans or mortgages for
more than they bought them for. This was how Australian group Pepper was able to
recently offer a €110,000 write-off for a family provided it sold its home. Mr
Deeter said the sale of loan books offered one of the best prospects for a
banking recovery.

Bank of Scotland/Halifax said it had a policy of
not commenting on whether or not it was planning to sell any part of its
business.

Michael Dowling of the Independent Mortgage
Advisers' Federation said buyers of bundles of loans from banks here were more
business-like when it came to negotiating debt write-downs with customers.

He said it was very difficult to get deals out of
domestic lenders but companies that bought distressed loan books would agree a
settlement where they could.

Domestically owed banks have shown a marked
reluctance to agree debt deals with distressed homeowners despite the
introduction of the personal insolvency legislation, which is expected early
next year.

The Irish Times reports that
as EU budget negotiations begin in Brussels tonight Taoiseach Enda Kenny is set
to align himself with French president François Hollande in an effort to defend
Ireland’s share of EU agriculture funding at the talks.

Despite weeks of gloom over the prospects for a
deal on a new seven-year spending plan, official sources are reporting a slight
pick-up in sentiment about the prospects for the summit.

“There has been a certain increase in optimism over the last couple of days. The
pendulum has swung in the direction of greater optimism but we’re still a long
way from certainty,” said a senior European diplomat.

British demands

The talks on a package worth some €1 trillion come amid pressure for budget cuts
as a result of the economic crisis, threatening allocations for agricultural and
cohesion policies. Mr Kenny aims to maintain Ireland’s share of funding in each
of these areas.

British demands for a budget freeze have dominated the pre-summit debate but
diplomats point out that such countries as France, Italy, Spain, Sweden and
Portugal have each expressed displeasure at a proposed draft budget from
European Council president Herman Van Rompuy.

However, a high-ranking figure in the summit said the present round of talks
stands as the best chance for an agreement.

“I can’t see a better timeframe or a game-changer in the coming months,” the
source said. “At this stage everyone is unhappy, which gives us the impression
that we’re not too far off from a compromise.”

Mr Van Rompuy, who may keep the leaders in Brussels through the weekend to
secure a deal, will table a compromise proposal tonight [Thursday] after a day
of bilateral talks with government leaders.

While his team has insisted in private talks that there will be no change to his
demand for a €80 billion cut from a €1.03 trillion European Commission proposal,
he may “reshuffle” proposed cutbacks between policy areas.

The Taoiseach’s meeting with Mr Van Rompuy and EU Commission chief José Manuel
Barroso takes place shortly before lunchtime, but the summit proper will not
begin until about 9pm.

The discussions are expected to continue late into the night and to resume
tomorrow.

Mr Kenny’s top priority is to conserve as much as possible of Ireland’s €1.7
billion share of annual agricultural and rural development spending.

In the year after Mr Kenny’s storied “Gallic spat” with Mr Hollande’s
predecessor, Nicolas Sarkozy, the Taoiseach’s alliance with the new French
president marks a rapid change in relations with Paris.
Budget cut

Mr Van Rompuy has proposed a €25 billion cut in the agriculture budget, leading
to claims from Irish farming interests that Ireland could lose as much as €1
billion between 2014 and 2020.

In Dublin this estimate is seen to be a little too high, but it is acknowledged
that any cut in the overall allocation would lead to reduced funding for
Ireland.

Mr Hollande has pushed back strongly against the Van Rompuy proposal in defence
of the agriculture budget and he is expected to rally support from Italian
leader Mario Monti.

This marks a big challenge in its own right for Mr Hollande, who has cast France
as a “bridge” between troubled southern powers such as Spain and Italy and the
group of prosperous northern countries led by Germany.

In contrast to her alliance with Mr Sarkozy, German chancellor Angela Merkel has
spent more time in the countdown to the summit cultivating British prime
minister David Cameron and Polish leader Donald Tusk.

With Dr Merkel perceived to be in close contact with Mr Van Rompuy, the
pre-summit assessment is that she is relatively comfortable with the current
draft proposal.

“The French are somewhat exasperated with the effort made by the Germans. The
French are used to getting their own way easily,” said the senior European
diplomat.

While Ireland’s share of Europe’s cohesion budget fell in the boom years, the
Taoiseach is expected to push for recognition of our high unemployment rate as a
basis for maintain funding in this area.

The Irish Times also reports
that State-owned Permanent TSB has sold most of the loans in the bank’s car
finance and leasing division to a company controlled by German lender Deutsche
Bank. The loans will be serviced by the division’s former management team.

The Deutsche-controlled company Consumer Auto
Receivables Finance is buying most of Permanent TSB Finance and the bank’s
unsecured personal lending business Blue Cube, which stopped writing business in
2008, as well as a small portfolio of largely corporate loans.

The two divisions are disposing of €351 million
of loans for a purchase price of €287 million, a discount of 18 per cent on the
book value of the loans at the end of February 2012.

The bank said it had also agreed to sell the
business platform of Permanent TSB Finance to a new company called First Citizen
Finance, set up by finance division managing director Chris Hanlon and other
members of his management team.

The Deutsche company has entered into a contract
with Hanlon’s company to service the assets acquired.

The Irish Examiner reports
that the IMF and EU appear to have ironed out their differences over Greece’s
bailout and releasing the long-delayed latest installment to Athens.

The Washington-based body was adamant that it
must be sure Greek’s debt was sustainable and drop to 120% of GDP by 2020.

Finance ministers spent 12 hours in Brussels intensively discussing the various
options to achieve this and finished up in the early hours of yesterday.

Eurozone president Jean Claude Juncker did not give details other than to say
there were complex technical details to be worked out and they would meet again
on Monday to finalise the agreement.

German finance minister Wolfgang Schäuble said they had agreed that Greece
should be lent funds to buy back their bonds on the secondary market.

These are available on the market at 65% to 80% of their original value. Mr
Schaeuble said that Greece could buy back as much as €10bn worth of its bonds.
It is understood that the money would be lent by the EU’s temporary rescue fund,
the European Financial Stability Facility.

Mr Schäuble, speaking in Berlin, said he was confident that a satisfactory
agreement will be reached on Greece at the meeting on Nov 26. It is expected
that once the ministers have approved a deal, it will go back to member states
where some parliaments need to agree it and then sign off finally at their next
eurogroup meeting on Dec 3.

This would then allow the disbursement of the €31bn held back for months from
Greece and possibly another €9bn due before the end of this year under their
bailout programme.

IMF chief Christine Lagarde, who flew into Brussels for the meeting, wanted the
EU to take a writedown on the loans, but this was flatly rejected. She has
rejected allowing Greece an additional two years, to 2022 to get its debt down
to 120%.

There were a number of different ideas of how to reduce the debt by about €14bn,
but most of these were rejected.

These included the ECB returning any profits it makes on the Greek bonds it
holds or take a haircut, and cutting the interest rate Greece pays on its first
loan which came from bi-lateral loans from the other eurozone member states,
including Ireland.

This would mean cutting the rate of interest to the Euribor rate, which would be
below the rate at which countries borrowed the money for Greece. A number of
countries, including Germany, said they could not legally do this.

The Greek prime minister Antonis Samaras is to meet Mr Juncker today in Brussels
and said that now that Greece had fulfilled all the demands made by the member
states and the troika, they should not suffer further delays in receiving the
money.

Mr Samaras is under pressure politically to have the funding released in the
wake of deeply unpopular austerity measures and budget cuts were voted through
the parliament.

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